Hoeven: USDA rule on COVID farm payments sent to OMB

-The Hagstrom Report
Sen. John Hoeven, R-N.D., talks to an online meeting of the North American Agricultural Journalists on Monday via Zoom.

The Agriculture Department sent the rule on making $16 billion in direct payments to farmers and ranchers for losses due to the coronavirus pandemic to the Office of Management and Budget on Friday, Senate Agriculture Appropriations Subcommittee Chairman John Hoeven, R-N.D., said.

In an online presentation to the North American Agricultural Journalists, Hoeven said USDA wants farmers and ranchers to provide information on their losses in mid May and hopes to issue payments by the end of May.

Hoeven noted that federal rules required the writing of a rule for the program. The rule will eventually be published in the Federal Register.

Hoeven said he had initially proposed increasing the borrowing authority for the Commodity Credit Corporation to $50 billion, but that when the Coronavirus Aid, Relief, and. Economic Security Act was finalized, the bill included an increase of $14 billion for the CCC and a separate $9.5 billion emergency fund for dairy and livestock producers and specialty crop growers.

The $14 billion will not be available until after USDA submits a report on CCC spending at the end of June.

Hoeven said that when Congress comes back into session on May 4 and begins to work on regular fiscal year 2021 appropriations bills he will propose increasing the CCC borrowing authority from the $30 billion to $50 billion per fiscal year.

He also said that if inflation were taken into consideration, the CCC authority should be $68 billion, a point that has been made by the American Farm Bureau Federation.

“There is more to be done,” Hoeven said.

Asked about farm and ranch groups’ criticism of the payment limits on coronavirus aid announced by the Agriculture Department, Hoeven said that the current payment limits might not stay in place. But he said there needs to be some level of payment limits to assure the money can be spread broadly enough to help the large number of people in agriculture who have coronavirus-related losses.

Hoeven repeatedly praised Sen. John Boozman, R-Ark., for his help in formulating the package. Boozman is in line to become the top Republican on the Senate Agriculture Committee following the retirement of Sen. Pat Roberts, R-Kan., the current chairman, at the end of the year.

Hoeven noted that he, Boozman and Sen. Chris Coons, D-Del., who has a lot of poultry plants in his state, are all looking beyond aid to farmers and ranchers to work on the broader supply chain. Hoeven said the senators want to be sure workers in meat plants and food processing plants get personal protective equipment and also learn how to manage social distancing outside work.

He also noted that, while the closure of the Smithfield plant with infected workers in Sioux Falls, S.D., “got a lot of attention,” companies are finding ways to close down plants for shorter periods of time to clean them before reopening.

Hoeven said that when Congress returns he expects conversations to take place on helping ethanol plants, but he said no program has been developed yet. He also said the severe decline in gasoline demand raises questions about whether the Renewable Fuel Standard’s volumetric requirements can be sustained.

North Dakota is a major oil producing state, and Hoeven has introduced legislation to provide $3 billion in funding to purchase crude oil produced in the United States for the Strategic Petroleum Reserve.

In a news release, Hoeven noted that the legislation aligns with the request made by President Donald Trump and Energy Secretary Dan Brouillette to fill the SPR. Sen. Chuck Grassley, R-Iowa, has said that if the Congress provides aid to the oil industry it should provide aid to the ethanol industry.

Asked whether the closure of meat plants leaving producers with no place to sell their animals could lead to a restructuring of the U.S. meat sector, Hoeven said that the issues of competitive pricing and transparency have been longstanding. He noted that it has been “hard to get all the associations together,” a reference to cattle groups being divided over whether there’s been a problem in cattle pricing.

Asked by a Canadian reporter how he would react to Canadian farmer concerns that the levels of aid announced by the U.S. government may interfere with international markets, Hoeven said that American farmers see a lot of unfairness in the types of aid that Canada provides farmers.

Hoeven said that when Congress comes back into session on May 4 he expects to remain in session until at least the August recess but that the length of the session will be driven by the coronavirus.

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